State dumps DMV computer overhaul effort

The State of California has spent hundreds of millions dollars to overhaul its aging computer infrastructure, but now a third state agency is bailing on the fix because the cost keeps sky-rocketing and some of it doesn't even work. This time it is at the Department of Motor Vehicles.

The $200 million effort to overhaul DMV's 40-year-old computer system that processes driver's licenses and vehicle registrations has been halted. After seven years and $135 million taxpayer dollars, only the driver's license portion is close to getting done.

"We thought it was time to bring the project to an end because they weren't going to be able to an agreement on how to finish it out," said Carlos Ramos, the California Technology Agency Secretary.

The stalled DMV project is the latest in a string of high-profile technology blunders that have plagued state government. Last week, Controller John Chiang fired the contractor charged with the $400 million upgrade to the state's payroll system because it's years behind schedule, triple the original estimate and it doesn't work. And last year after doling out $500 million, the courts pulled the plug on the effort to electronically connect every courthouse in the state when the costs ballooned to $2 billion.

"It's ironic that California, being the birthplace of the high tech industry, can't seem to get its act together," said Jon Coupal from the Howard Jarvis Taxpayers Association.

However, the state's technology chief says they do have some successes. California is the first state to have a mobile apps store, an online voter registration system kicked off in the fall, and family and friends can make online reservations to visit an inmate. Ramos admits, though, the state may be too big for certain projects.

"Technology projects in and of themselves are pretty complex undertakings, but when you take on something of the scope and scale of California, they're inherently risky," said Ramos.

State department heads don't make projects easy either.

"What we've heard from some of the people in the private sector is that the state will ask for something but then they'll change their minds later, or they're not clear as to what they really want," said Coupal.

The state will be evaluating what to do next in the court and DMV projects. The state controller has said he'll sue the payroll contractor to get at least some of the taxpayers' money back.